Teaching kids the value of a dollar

standard November 30, 2011 1 response

We live in a weird place where money doesn’t go nearly as far as it does in the rest of the country.

Where else (other than NY) does half-a-million dollars count as the down-payment to a tiny house rather than the entire price of a large one? Where else do people buy luxury cars to park in front of those tiny homes because they can afford the vehicle, but not a nicer home?

At the same time, we live in a place where all to many people have more money than they know what to do with. And with all the IPOs for local companies set to happen in the next year, that’s going to get worse before it gets better.

The upshoot of it all is that my girls are being raised around kids who have a lot. And faced with that, it’s so hard to help them understand the value of money and to help them appreciate what they have.

For the longest time I didn’t worry about it beyond helping them take stock of what we have when the “gimmes” would strike. But now that they’re getting older and are starting to be able to understand that things don’t just magically appear in our home, I’m wondering how to best help them grasp the value of money and how to save for the things we really want or need.

Let’s be honest though, I’m starting at a disadvantage because I might well be the worst money manager in town. (I can just picture my husband nodding as he reads this.) I grew up essentially believing that money would be there when I needed it, and if it wasn’t there right away, it would eventually turn up. (The most memorable instance of this was the first Tax Rebate issued by the Bush administration. That check landed in my mailbox, utterly unexpectedly since at the time I never read the paper, the day I desperately needed rent money. M nearly flipped his lid. Money management lesson lost. I still find the memory amusing.) 

I’ve learned, largely thanks to my husband, how to budget, how to save, how to resist impulse buys. It hasn’t been easy, but I’ve learned. And now I need to pass that knowledge on to my kids.

– We talk about what things are more expensive than others when we’re at the store.
– We talk about how we have to chose between two things we want.
– We talk about putting bigger ticket items on our Christmas or Birthday List.
– We talk in code. A movie is worth four squinkies. An ice cream is three. A trip to Chicago to see the cousins is a bunch of American Girl dolls. Anything to get them to see how it all adds up.
– I verbalize my choices while shopping, walking them both through my decision process so they can see that the purchases aren’t random, but calculated.

C has money in her piggy bank that she’s saving up to buy herself a fossil that she saw in a rock store. There was no good reason for me to get it for her, so I suggested that she see how much was in her piggy bank. Now when she begs for something I can ask her if she wants it more than the fossil. So far, she hasn’t wanted anything more than that.

It’s an ongoing process, one that I’m actually enjoying. It’s fun to watch them start to understand, fun to be there as they start to really appreciate what they have. Who knows, maybe I’ll learn something in the process too!


This post was inspired and sponsored by Kidworth, a new site designed to teach kids financial goal setting. It’s the perfect season to set up Kidworth accounts for the kids in your life! Family and friends can help you give them the gift of financial responsibility. Parents set up an account, and kids enter their goals. Whether they are saving up for guitar lessons, or a donation to the local animal shelter, Kidworth can help them achieve their dreams this holiday season, meaning you won’t be as overrun with “stuff.”

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